PRIORITIZING HYDROPOWER DEVELOPMENT USING ANALYTICAL HIERARCHY PROCESS (AHP) – A CASE STUDY OF NEPAL

Nepal possesses huge hydropower potential but lacks experience, funding and political stability which are critical to development. Different national strategies have been proposed in the past ranging from promoting small scale hydro that provides local to regional economic incentives to the recommendation of large schemes to enhance national objectives. This paper analyses the last few decades of hydropower development in Nepal and proposes a multi-criterion approach, the Analytic Hierarchy Process (AHP), to identify projects considering social and environmental concerns in addition to economic objectives. A multi-perspective look at prioritizing hydropower schemes namely micro (below 1 MW), small (from 1-25 MW), medium (from 25-100 MW), big (from 100-1000 MW) and large (greater than 1000 MW) is important in order for hydropower development to proceed in the best possible way. This perspective could be of use in strengthening hydropower related strategy and policy in Nepal.   The prioritization procedure is embedded into a multi-objective framework including six goals, namely a technical goal measured by four criteria, a social goal with five criteria, an economic goal with six criteria, an environmental goal with 4 criteria, a political goal characterised by 4 criteria and an additional goal referring to the various uncertainties, expressed by five criteria.  Evidence based subjective value judgment based on secondary sources, mainly related documents and experts consultations, is used for the prioritization approach. This research could help policy makers to maximize the benefit to the country by adopting appropriate policies and strategies.    The effectiveness of multi criteria evaluation techniques and the Analytic Hierarchy Process (AHP) for hydropower prioritization is the focus of this research. The outcome of the paper is the secondary information based on the AHP application for hydropower scale of schemes prioritization.   This paper is presented in six sections.   The first section is the introduction focusing on the country context and MCDA in hydropower.  The second section discusses the problem definition, and the third section describes objectives and tasks. Similarly, the fourth section details the applied methodology, and the fifth section describes the results and discussion. Finally, the sixth section presents conclusions and recommendations of the research work.